SAPX‎ - Seven Arts Entertainment

Hey guys, I am very new to trading but decided to give it a try. I bought 450 shares of SAPX at $0.39 a share and it just seems to be dropping slowly. Should I dump it? I'm down like $50 including commissions, like I said very new and just testing the waters.

Edit- I would also like to change my username to Mr. Taco. Is this possible?

I've been watching SAPX a very long time. Watch this one guys, they come with lots of little press releases (don't get me wrong, they're all positive)

So whats going on right now ? Well they need to have a minimum bid of $ 1,00 to stay listed on NASDAQ (see my post above). Now that they have all the attention from investors and little traders (volume and PR), I think its the best time to do a R/S. Telik was in the exact same positon: received notice, price was last days around .13-.15 with relative good volume and suddenly a 1-30 RS..what happened after ? Price went up: First $3,20...after that $4 and at the end it reached a top at $5 after descending a bit, and now around $3 again.

It's cheap for the longterm traders, and I could not care less that a R/S is bad for them...I'm just scalping but still buying cheap to have a position overnight.

Form 8K (page 4) of SAPX released 4 weeks ago:

Quote:

4)

The Board was authorized to implement a reverse split of our common stock in a range of 1:3 to 1:10 in order to protect the Company’s NASDAQ listing; but, as previously announced, NASDAQ has extended until September 20, 2012 the date by which the Company must meet the NASDAQ requirement that the closing bid price of the Company’s common stock be $1 or more for at least 10 consecutive trading days. The Board does not intend to exercise the authority it was granted until required to do so in connection with the Company’s NASDAQ listing or in connection with a material acquisition by the Company (although none is currently contemplated).

Finally in June DMX will release a new album, the last one was a relative good succes (look up the sales of the previous albums). So SAPX will probably get more cash.

def weak and a bearish trend...today will show as up but imo its still a down day of sorts as it finishes just slightly up and lower than it opened...lower highs and lower lows is the pattern for over 6 months now...not for me til that clearly reverses

Shareholders of Seven Arts Entertainment Inc. (NASDAQ: SAPX) would appear to have a legitimate cause for concern as the independent motion picture and distribution company continues to struggle with realizing significant revenue from their operations. While SAPX announced on Tuesday that they had licensed United States pay television rights to its film “The Pool Boys” to HBO and is licensing the English pay television rights to the film to BSkyB there are few investors who believe these deals will amount to anything substantial despite company CEO Peter Hoffman’s contention that “We continue to build the digital and television licensing of our films, directly and through our distributors. We believe this revenue will be an important contribution to our financial results in future periods.”

With shares currently trading around the 0.11 level SAPX remains in danger of a NASDAQ delisting, something they have skirted for some time now.Back in March the company announced that they had received a letter from The NASDAQ Stock Market LLC approving their request for a 180-day extension of time to regain compliance with the NASDAQ bid price requirement by demonstrating a closing bid price for its common stock of $1 or more for at least ten consecutive trading days. That approval gives SAPX until September 20, 2012 to regain compliance but there has been little indication that such an event would take place without existing shareholders paying a price.

SAPX has insisted they have no plans for a reverse stock split yet they did leave the option on the table as a method to protect their NASDAQ listing. According to their April 16, 2012 press release “Management does not currently believe a reverse split will be necessary in light of the prospects of the Company’s business, including the release of DMX’s new album “Undisputed” and production of “Neuromancer.” This confidence may be difficult for shareholders to swallow given the fact that last May they implemented a 5:1 reverse stock split to regain compliance with their NASDAQ listing.

While that move pushed shares of SAPX above the minimum bid price for a couple of months the company’s share price hasn’t been above that mark since August 2011. In that same April 16, 2012 press release SAPX announced that they had terminated negotiations for a $3,000,000 convertible debenture, the proceeds of which were to have been used for reacquisition of approximately twelve of the Company’s motion pictures controlled by an existing lender. The company reasoned that such a deal would have “resulted in an unacceptable level of dilution to the Company’s common shareholders.”

That sounds awfully noble of SAPX yet the reality is dilution appears to be an inevitable fate for shareholders. SAPX may point to the release of a new album from DMX and the production of “Neuromancer” as cause for stability but it is unlikely that these events will right the ship by September, especially given the fact that shooting for the $60 million budget feature “Neuromancer” isn’t scheduled until later this year with distribution slated for autumn 2013.

Certainly SAPX is putting a lot of weight on “Neuromancer” as they have been pumping the production of the film, based on the best-selling novel of the same name by William Gibson, for some time. Of course SAPX was also pumping the release of “The Pool Boys” and that film did little in the way of revenue for the company.

It is SAPX’s hope that their recent agreement with di Bonaventura Pictures for the services of Lorenzo di Bonaventura will put “Neuromancer” over the top. SAPX points to di Bonaventura’s work on “The Matrix” and “Harry Potter” series of films as cause for celebration but asking shareholders to believe the success of those films could be replicated with this film is a stretch.

Unquestionably SAPX is in desperate need of a successful film given their most recent quarterly report, a report that showed film revenues for the second quarter to be $207,790 as compared with $1,137,647 for the same period one year earlier. The company reported negative gross profit for the frame and acknowledged that “higher than normal legal costs” had taken a toll on the company’s results.

There is simply no way to look at SAPX without concluding that the company will likely opt for a reverse stock split come September. They are in far worse shape than they were last May when shares were trading in the 0.35 – 0.37 range and knowing this shareholders should be prepared to stomach yet another split that will result in further dilution.

so it looks AND sounds ugly ...
reverse split and then dilute...share holder robbery...but happens all too often...r/s in micro caps are very often a last grasp at something that isnt there...hope and a future

may be able to play pops or bounces here and there but wouldnt buy and look away for too long...(hours or minutes)

Is it possible, that they'll wait from now as we speak untill september 20 for the stockprice to reach .20-.30 and then performing a R/S to stay way above $1.00, and getting through those 10 tradingdays ?

Is it possible, that they'll wait from now as we speak untill september 20 for the stockprice to reach .20-.30 and then performing a R/S to stay way above $1.00, and getting through those 10 tradingdays ?